The thought of buying a home can bring you joy, excitement, trepidation, and anything in between; and, unless you make your living as a realtor, the entire realm of real estate might just seem real confusing. Below we’ve compiled a list of the most common home buying FAQs (frequently asked questions) to help make the home buying process a breeze.
Relax, and read on!
The short answer is, it depends. In most scenarios, the contract states that you will get “Possession” (aka keys!) at 9 pm of the day that the house records. In many cases, the Seller will give permission for the Buyer to receive keys at the time of recording, however, unless otherwise specified, they technically and contractually have until 9 pm to clear out and turn possession over to the Buyer.
In some circumstances, the Seller may make a request to be able to stay in the home for a few days after the deal closes. If that happens, there is typically an offer of a daily rental fee to the new owners. You may be able to get your keys, but you won’t be able to move in until the Seller has officially moved out.
The Purchase and Sale Agreement (PSA) is the document (or contract) made between the Buyer and the Seller. This includes the sale price of your new home and all the terms and contingencies of the purchase. This is always signed in two parts and is done at the very beginning of a deal. The Buyer initiates the process by filling out and signing a Purchase and Sale Agreement. (At this stage the PSA is an offer because the Seller has not signed it.) If the Seller decides to accept the Buyer offer, they will sign the entire PSA and it becomes a Mutually Accepted Contract or a Signed Around Deal. If the Seller does not accept the Buyer’s offer but wants to make a change, they can present a Counter-Offer to the Buyer.
Typically, the Seller will sign the entire contract and attach a Counter-Offer addendum with the changes. Price is very often a counter-offer term, but any part of the contract, if changed by the Seller, constitutes a counter-offer. If the Buyer accepts these changes, they only have to sign the counter-offer addendum, indicating they accept, and we have a mutually accepted contract. Alternatively, the Buyer can present the Seller with a counter of their own – and this can go back and forth until either both parties agree (mutual acceptance) or they decide that they just aren’t going to reach an agreement on terms and part ways.
Usually, the first payment on your new home will be due on the first day of the month after the 30 day period following closing. So, if you closed on February 14th, your first payment would be due on April 1st (no fooling!)
This is one of the most common home buying FAQs, and with good reason. No one wants to show up on moving day and find damage to their new purchase. In most cases, this is a breach of the purchase and sale agreement. If it was spelled out in the contract that the Seller must leave the home in essentially the same condition as on the date of signing, you may have the ability to pursue legal action. Your Realtor should NOT EVER offer you legal advice as (with very few exceptions) we are NOT lawyers and offering legal advice (even something as seemingly innocent as “you can take them to court”) is a big no-no! Your Realtor can (and should) advise you to seek legal counsel from the appropriate legal professional. They may have someone that they recommend. They just can’t offer legal advice themselves! Unfortunately, this can be a sticky situation, as the unscrupulous Seller already has their money, and might not be inclined to communicate. We do have the opportunity for the Buyer to conduct a final walkthrough – and it is recommended that you take advantage of this opportunity for this very reason.
An appraisal is a report made by a neutral, third party about the value of the home, taking into account the market and all the elements of the home. An inspection is a report on the condition, integrity, and functionality of the home, which looks for problems in areas such as roofing, foundation, and plumbing. The bank will hire the appraisal and the cost of this is wrapped up in your closing costs. The Buyer is responsible for hiring and paying for the inspector. The inspector will provide you with a very thorough report on the condition of the home and you will discuss this with your realtor in forming your response to the Seller as part of the contract.
Earnest money is also known as a good faith deposit. It is an amount of money you put down to prove to the Seller that you’re serious about buying. This also protects the Seller if the Buyer ends up backing out. Earnest money is normally due once the Buyer and Seller have entered into a contract and the closing process begins.
The short answer is, it depends. With most lenders, your down payment will be anywhere from 3% – 20% of the price of the home (but there are even zero down loans available), and closing costs typically range from $4,000 to $9000. You will also need to have the earnest money available (commonly 1% of the purchase price) and funds to pay the inspector. There are a lot of variables to this, and it is well worth your time to research all your options in terms of down payments, closing costs, and insurance rates.
To make sure you get the best deal possible on your new home, you’ll want to shop around for the lender and mortgage that are the best fit for you and find an experienced, reliable real estate agent! The value of working with professionals you can trust (particularly the lender and Realtor) can’t be overstated! A good lender will help you figure out how to get the best terms and rates for your situation. Your Realtor can help you negotiate with the Seller. Depending on the situation, you may be able to have the Seller pay your closing costs or include extras, like appliances or that hot tub in the backyard!
Being willing to buy during any season can position you to get that great deal that no-one else saw! Your lender and Realtor can help you get your finances in order so that you can present the most attractive offer possible! You can also consider buying a fixer-upper, if you’re handy and willing to put in some work to save yourself some cash. These can be tricky if you are working with a bank. Some small fixer projects are usually okay, but don’t expect the bank to sign off on you buying a house that is in very bad disrepair!
A homeowners association, or HOA, is an organization that makes and enforces rules for the properties and residents of a community. This is relevant when purchasing a home because, once you’ve bought the home, you’ve bought into the HOA, too. Buying a home within an HOA’s jurisdiction makes you an automatic member of the HOA. This means you’ll have to pay membership fees and abide by all HOA regulations, which can sometimes be quite restrictive.
The timeline varies from person to person and purchase to purchase, but once you find a house and your offer has been accepted, the closing process will generally take 30 – 45 days.
That’s exactly what I’m here for. Schedule a consultation and let’s chat about your specific needs. I’ll answer any questions you have and we can plot the course for your home buying or selling success!
©2022 by Jon Biron – RE/MAX Inland Empire
1311 N. Washington Street, Ste. A, Spokane, Washington 99201
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